Source: Scientific American
The concept of 'carbon-free vessels', which are expected by the IMO leadership and like-minded western counterparts to be capable of navigating the cold Arctic seas, is experiencing difficulty after change of American administration in January 2025. Within a debate on the relative merits of Western and non-Western approaches to Arctic shipping and maritime routes development, this field is facing increased regulatory scrutiny in the final months of the outgoing year, driven by the imperative to decarbonize. It is reasonable to say that a view on shipping decarbonization will hardly bring about any radical change in U.S.-Russia relations, but it appears that the Europeans may become dissatisfied due to the absence of U.S. advocacy on this matter.
It seems that fossil fuels will continue to have an important role in shaping the global energy landscape for a long, long, long time to come. Phasing out fossil fuels a ‘fantasy,’ oil executives say amid giant profits at an energy conference in Houston. Despite their public pronouncements, BP, Chevron, Exxon, and Shell have no real intention of transitioning towards clean energy sources, according to the U.S. House Oversight and Reform Committee’s findings. Exxon Mobil’s 2024 Global Outlook declares that “oil and natural gas remain vital”, citing their necessity for the contemporary society. And there are dozens upon dozens more examples showing that the viability of emissions reduction initiatives hinges on their capacity to substantiate the sustained production of fossil fuels. More than 40 projects to incorporate biofuels into major companies' strategies, planned by the end of this decade, are pursuing this goal.
Source: U.S. Energy Information Administration
Indeed, maritime decarbonization RDI is a critical investment for the U.S. ocean policy. It is supported by several federal agencies, most notably the U.S. Department of Energy, the U.S. Maritime Administration (MARAD), and the U.S. Navy. While dedicated RDI spending for maritime decarbonization is relatively modest, it does benefit from substantial indirect funding through numerous other RDI budgets aligned with related topics, such as biofuels, engine combustion research, and freight optimization.
Analysts have indicated that these programs may be eliminated or significantly reduced in the near future. There is also a concern about the Republicans' intention to dismantle the National Oceanographic and Atmospheric Administration (NOAA). Unlike Biden’s administration, the proposed appointments of Mike Waltz and Marco Rubio for the roles of National Security Adviser and Secretary of State, respectively, indicate a lack of interest in pursuing a regulatory-heavy, atmospheric and climate-focused spending strategy for the purpose of implementing a more assertive, U.S.-first maritime policy approach. However, it is unlikely that all of the applied program offices will be fully eliminated since they do a lot to support business in many Republican-represented districts and states.
It is also worth noting that the federal government is currently drafting a Maritime Decarbonization Action Plan, an important piece of for U.S. ocean policy, which should be published before President Biden leaves office. It is likely that many of the recommended actions will not be implemented, and the strategy may require modifications under the new administration. From recent comments, Allyson Browne, CEO of High Ambition Climate Collective, a US-based non-profit environmental organization, expresses concerns that funds allocated by the Biden administration for climate goals may be clawed back soon after Trump takes office. On October 29, the U.S. Environmental Protection Agency has announced the selection of 55 projects that will receive nearly $3 billion through its Clean Ports Program.
Despite the challenges, proponents of decarbonization and traditional fossil fuels’ shift away do not give up. They contend that reducing the use of coal, oil and gas is vital for the future of civilization. Many recall the 1920s, when the fossil-fuel industry promoted an activity that would soon have a detrimental impact on public health: the addition of lead to gasoline. The representatives of American industry, including industrialists Charles F. Kettering and Alfred P. Sloan and oil magnate John D. Rockefeller, asserted that lead in gasoline was vital for the U.S. economy, industrial progress, and the American way of life. In 1965, it was estimated that the blood lead level of many Americans was more than 100 times what it would be from natural causes. In 1973, the U.S. began a gradual phase-out of leaded gasoline. In 2021, Algeria became the last country to ban it.
The United States has a direct (not through its allies) presence in the Arctic region only because 1/3 of the state of Alaska is located beyond the Arctic Circle. The U.S. largest state Alaska, with a relatively small population, has been among the strongest pro-Trump states. Also, Alaska is among the states whose economy depends the most on federal spending, and federal regulations have a significant impact on the state’s resource extraction industries and the environment.
Despite the growth in Arctic shipping, the U.S. remains engaged in this region through sanctions imposed on Russia's flagship Arctic LNG projects as well as companies helping Russia in the implementation of energy projects. As part of marine scientific activities, the so-called Healy team, comprising representatives from the U.S. National Science Foundation (NSF), NOAA, American universities, and the U.S. Coast Guard, is gaining Arctic research experience and expertise. As far as high political tensions in the Arctic region are concerned, the Arctic military build-up, arms procurements and the U.S.-led exercises in collaboration with its Nordic allies assume a top priority. In addition, the text below illustrates that the U.S. is also focused on domestic extraction activities.
Source: 2024 Arctic Shipping Status Report / The Arctic Council
The situation looks that legal environmental infrastructure that has been in place since the 1970s will make it challenging for Trump to pursue an expansion of drilling and fossil fuel production in Alaska. According to Kierán Suckling, executive director for the Center for Biological Diversity, Trump is planning to open up the Arctic National Wildlife Refuge to unfettered oil drilling, as well as areas outside of the refuge along the Alaska coast. During Trump's first term, the Center for Biological Diversity initiated legal proceedings against the administration 266 times and won about 90% of these cases. Earthjustice initiated about 200 lawsuits against the Trump administration and won about 85% of cases.
Meanwhile, U.S. Senators Lisa Murkowski and Dan Sullivan (both R-Alaska) and Representative Mary Peltola (D-Alaska) praised the Biden administration's decision to advance the Willow oil project within Alaska's National Petroleum Reserve. They pointed out the creation of thousands of new jobs, the generation of billions of dollars in new revenues, and improvements to the quality of life.
According to opponents of heavy fuel oil in the West, its use leads to large amounts of harmful emissions into the atmosphere. In response, the ban on heavy fuel oil (HFO) in Arctic waters came into effect on 1 July 2024. The position of Russia remains unclear, having shipping operators under sanctions and issues with calling at European ports. Meanwhile, Finland and Canada are planning to introduce the ban on the use and carriage of HFO into legislation at the beginning of 2025. Furthermore, a 2024 report commissioned by the European Maritime Safety Agency (EMSA) recommends collaborative initiatives to decarbonise the shipping sector and adopt new international standards for ships utilising oil-based fossil fuels, synthetic fuels, biofuels, and other alternative energy sources.
Some assessments indicate that the eight Arctic states and 13 non-Arctic states are collectively responsible for 68.02% of the global total of CO₂ emissions. With the IMO playing a crucial role in this process, it is currently considering to establish new emission control areas (ECA) in the Arctic and the North Atlantic. This may soon become a point of contention with the Trump administration, which may view the introduction of tightening regulations in specific regions as somehow hindering the U.S. plans in relation to its Arctic allies, namely Canada, Norway, and Greenland.
Source: International Council on Clean Transportation (ICCT)
At the 82nd session of the Marine Environment Protection Committee, the IMO adopted amendments to MARPOL, designating the Canadian Arctic and the Norwegian Sea as ECAs. While the Canadian Arctic ECA extends from the 137th meridian west in the Beaufort Sea to the existing North American ECA boundary in the east, the Norwegian Sea ECA covers the Norwegian Exclusive Economic Zone to the north of 62 degrees latitude, including Norwegian fjords and coastal waters. It would require ships in the proposed area to meet more stringent standards for reducing sulfur oxides (SOx), nitrogen oxides (NOx), and particulate matter (PM) emissions.
This decision was followed by the proposal by the International Council on Clean Transportation (ICCT) to create an emission control area in the North Atlantic (AtlECA). It is said that the AtlECA would include the territorial seas and exclusive economic zones of the Faroe Islands, France, Greenland, Iceland, Ireland, Portugal, Spain, and the United Kingdom. Establishing the AtlECA could potentially reduce shipping-related SO2 by 86 per cent, PM2.5 by 59 per cent, and NO2 by 3 per cent in the region.
The establishment of AtlECA may have an indirect impact on U.S.-Greenland relations, which are expected to develop further via the so-called free association agreement (FAA). The FAA could facilitate a more integrated political and economic relationship between Greenland and the United States, including the resource extraction in the Atlantic and Arctic oceans, while maintaining Greenland's autonomy. Greenland's Minister for Foreign Affairs, Vivian Motzfeldt, has confirmed that the Greenlandic government is prepared to collaborate with the Trump administration. Additionally, Greenland’s Foreign, Security and Defense Policy 2024-2033 notes that the collaboration will involve exploring direct trade and transport routes between Greenland and the United States.
As far as the Canadian Arctic is concerned, nothing is available regarding the «eco-friendliness» (if appropriate) of icebreakers, resulting from joint efforts by Canada, Finland and the U.S, most commonly referred to as the ICE Pact. Despite none of these vessels has been laid down yet, they are expected to number between 70 and 90. It may be proposed that the Finnish shipbuilding industry could contribute its expertise in the construction of icebreaking vessels capable of utilising both LNG and ultra-low-sulfur diesel as fuel sources. Plus, at ABS North America Regional Committee Meeting held on November 11, maritime industry leaders from the U.S. and Canada heard how new vessel orders, however not ice-class, show an increase in dual-fuel readiness in comparison to conventional fuels, with the majority of new builds designed to be LNG-ready.
A concise analysis of the core trends in Arctic shipping and extraction policies has revealed that Trump's policy is representing a challenge to European interests, while offering Russia an opportunity to reassert itself. As the maritime landscape evolves under the new U.S. leadership, international shipping leaders may need to revise their strategies for engagement with the U.S., particularly with regard to European climate-focused expenditure and regulatory policies which are dominating the international shipping agenda.
Ekaterina Serova
Also read the publication:
Icebreakers Matter: The US’s Fragile Fleet
